Tuesday, September 23, 2008

BRK + GS: You heard it here first

While it's not an outright purchase, Buffett did agree to invest $5 billion in cash...considering Goldman has a market cap of around $50 billion, that's a pretty significant stake.

And Warren got a sweet deal too...perpetual preferred shares that pay a 10% dividend, callable at a 10% premium, plus a 5-year warrant to purchase $5 billion of common at $115/share (Goldman closed at $125, and was up to $138 in after-hours trading).

Of course, as my wife pointed out as I was crowing over my powers of prognostication, "So did you buy any Goldman? Did we make money?"

Damn. Would have been nice to pick up some Goldman calls when it was at $90/share!